The wasteland that Ahwatukee Lakes Golf Course became after it was closed in 2013 could be reversed in 18 months, residents contend in their lawsuit against the owner, The True Life Companies.
Tom Sanfilippo/Inside Out Aerial

Two homeowners suing over the future of the defunct Ahwatukee Lakes Golf Course had the last word in the protracted legal case as their lawyer contended its owner has no recourse but to return the site to its former state.

Directly confronting The True Life Companies’ assertion that a judge has no authority to dictate restoration details for the course, attorney Timothy Barnes said the company’s “open-ended breadth of scope” of its argument “is contrary to Arizona law.”

Barnes’ reply brings to an end legal argument in the 4-year-old case, leaving Superior Court Judge John Hannah the task of issuing an order that likely will be appealed.

Because Hannah ruled two years ago that the covenants, conditions, and restrictions governing the 101-acre site require the owner to keep it a golf course, his next step likely is issuing an injunction that enforces that ruling.

True Life lost a bid to have Hannah declare the CC&Rs were no longer enforceable because a course was no longer viable because of extenuating circumstances – primarily its deterioration, which Barnes said is partly the firm’s fault.

It also failed to persuade the judge to let modify the CC&Rs in a way that would allow it to build homes if it agreed to construct an undefined “fun golf course.”

The court case began coming to a head over the last six months after the company lost its campaign to get approval by 51 percent of the approximate 5,400 homeowners to agree to changing the CC&Rs so it could build Ahwatukee Farms.

That so-called agrihood would have included about 270 single-family and two-family homes, a five-acre farm, private school and other amenities such as a café and trails.

In its last response to Hannah, True Life attorney Chris Baniszewski told the judge that even if his client were to comply with the court’s order to restore the golf course, he couldn’t dictate how it should rebuild it.

He also objected to a request by residents Linda Swain and Eileen Breslin – the plaintiffs in the case – that a special master be appointed to oversee its reconstruction within 18 months.

Barnes has recommended the court appoint Kip Wolfe, vice president of golf operations for Pro Turf International in Las Vegas, to act as the special master at the rate of $180 an hour – and at True Life’s expense.

True Life said its experts estimate that restoration of the course would cost at least $14 million – more than twice what the residents’ experts say it would cost.

But Wolfe has couched his estimate with a warning that there are some unknowns surrounding the course.

While he said “he basic core of the course is still intact,” Wolfe said he has not been able to determine the condition of the water delivery system and virtually anything having to do with water, including the lakes, transfer stations and reservoirs.

Barnes in his new filing said “a special master is necessitated by defendant’s breach of the 1992 Covenants, Conditions and Restrictions.”

“Having also breached its covenant of good faith and fair dealing of that document, the oversight of any restoration must be by a third party special master,” Barnes wrote.

He argued that a special master can “address post-trial matters that cannot be addressed effectively and timely by an available superior court judge.”

One reason for that, he said, is any court “most certainly does not need to get involved in the minutia of the design and restoration of a golf course.”

Moreover, he noted, “On a practical level, because superior court judges are frequently rotated for the benefit of the court system as a whole, having a special master with continuity is a major advantage in the court’s supervision of the injunction.”

Otherwise, a new judge assigned the case would have to spend considerable time getting acquainted with the case, further delaying the course’s restoration.

“A special master is professionally equipped to more readily resolve the reconstruction aspects of restoration issues and, if challenged, advise the Court of options to resolve the challenge,” Barnes wrote.

As for True Life’s assertion that “imposing any expense on TTLC to pay a special master would be patently unfair,” Barnes said True Life’s past history at Ahwatukee Lakes demonstrates the need for one.

“Defendant’s ‘patently unfair’ arrogation must be considered in the context Defendant’s strategy as outlined at trial: purchase a purposely deteriorated golf course (with no intention of restoring it), and perpetuate deterioration in order to extort homeowners’ acceptance of the destruction of their home values so that Defendant may profit by building a housing tract,” he wrote.

In arguing against True Life’s contention that it alone can decide how to restore the course and what kind it can build, Barnes said True Life “is the cause for the condition of the Lakes Golf Course being incapable of being used for playing or practicing golf.”

“It has long been the rule that an interpretation which gives effective meaning to all provisions of a contract is preferable to an interpretation which leaves a part of the contract ineffective.”

He said True Life’s “open-ended breadth of scope” in its assertion “would preclude any such injunction from being enforceable.”“Defendant’s proposed scope of injunction provides no details to the required course of reconstruction – making it impossible to determine whether the injunctive order is being followed at any point in time,” he said, adding:“Defendant’s proposed injunctive order contains no standards by which progress of the restoration could be measured because no specific reconstruction details are provided.

“Likewise, Defendant would be essentially the sole arbiter of whether the injunctive order was being met, assuring itself that it could not be challenged” on either the scope or progress of the restoration.​Barnes said True Life’s “is not valid under Arizona law or even by the standard of common sense” and called its argument “yet another attempted roadblock to enforcement of the 1992 Covenants, Conditions and Restriction"

Plaintiffs in the Ahwatukee Lakes Golf Course case and the president of Save the Lakes/Save Open Spaces Thursday saluted the ruling by Judge John Hannah as a victory for homeowners, a warning to developers who undercut homeowner protections – and a first step in restoring the golf course and its neighborhoods.

Judge Hannah ruled Jan. 2 that “TTLC (The True Life Companies) knowingly and voluntarily purchased the Lakes Golf Course with the contractual obligation to operate a golf course on it,” but tried to put up a housing tract, instead. As a result, Hannah wrote, “TTLC has breached its covenant of good faith and fair dealing.” The judge denied TTLC’s request to change that obligation, then reserved special attention for Bixby, the company which sold the course, headed by Wilson Gee.

The Judge wrote, “not later than 2008, Mr. Gee in fact began making efforts (himself) to redevelop the Ahwatukee Lakes Golf Course. In the fall of 2008, Mr. Gee met with the Ahwatukee Board of Management” to initiate that discussion, even though “There was no evidence that the golf course could not have been operated profitably in 2008.”

Five years later, Gee “shut down the well that supplied water to the lakes, depleting the water needed for irrigation.” Gee’s company, Bixby, “removed all but obsolete irrigation heads and shut off all power to the site including the clubhouse. The site, therefore, had not had any water or electricity since May of 2013.” The result, Hannah said at trial, turned the lush green golf course into a desolate “moonscape.” In buying the property, TTLC acquired free rights to 500 acre feet a year of water to irrigate the golf course, but didn’t even investigate how to turn on the electricity to deliver it, Hannah wrote. The result has been a catastrophe for fish, wildlife, birds, vegetation, and community life.

Hannah concluded, “The inequitable conduct of (Gee’s company), which largely created the alleged hardship to the property owner, also cuts against equitable relief for (TTLC). At the very least, TTLC had reason to know that Bixby's actions substantially contributed to the conditions that made restoration of the golf course economically unfeasible. (Gee’s company), not TTLC, will bear most of the economic burden if the transaction fails. That result, frankly, will not be unfair.”

In contrast, the winning plaintiffs in the case hailed Judge Hannah’s decision as eminently fair.

Co-plaintiff Linda Swain said:“Judge Hannah ruled that as a matter of law, we are entitled to an injunction to undo the damage to our community caused by developers over 10 years' time. In order to make millions for themselves, they destroyed the landscape, blighted our neighborhoods, divided our community, undercut the value of our homes -- and then blamed the victims.”

Co-plaintiff Eileen Breslin said:“The victims include elderly women alone, some getting around with walkers or canes, who invested their life savings in homes along the Ahwatukee Lakes Golf Course to ensure a quiet, secure retirement. Instead, they’ve been rolled by developers and shut out by the Ahwatukee Board of Management, which nevertheless took their annual fees. Who was to speak for these women, if we did not? Who will speak for us, if the time comes again?”

Ben Holt, president of Save the Lakes/Save Open Space, said: “Developer True Life told us that golf is dead, yet they continue to invest millions in golf properties. In the course of testimony, it became clear that three to four buyers have expressed interest in purchasing and operating the Ahwatukee Lakes Golf Course."

“On behalf of Save the Lakes/Save Open Spaces, we thank Judge Hannah for his ruling. We especially thank our outstanding legal team led by Tim Barnes; the membership of STL/SOS, and the majority of the Ahwatukee community who generously supported our effort -- and refused to permit not one but three different developers to roll us over. This was a community-wide effort. The victory belongs to the thousands of people who supported us. We anticipate seeking damages to properly restore the golf course and its neighborhoods."

“Finally, we owe an enormous thank you to Linda Swain and Eileen Breslin, who endured insults, abuse, threats and recrimination for standing up to big money developers and those who supported them. By their example, Linda and Eileen embody the definition of hero. We, and the entire Village of Ahwatukee, owe them a tremendous debt."

“We look forward to this decision helping us to renew our landscape and heal the scars in our community from this conflict.”

Judge Hannah awarded attorney fees, court costs, and injunctive relief to the plaintiffs, to be borne by the losers. The details will be spelled out in a final ruling expected in March.

The attorney for Ahwatukee Lakes homeowners who prevailed in their court fight against The True Life Companies has asked a judge to appoint a special master who would oversee the restoration of the defunct golf course by November 2019 at an estimated cost of around $6 million.

Attorney Tim Barnes this week gave Superior Court Judge John R. Hannah a proposed order that would name Kip Wolfe, vice president of golf operations for Pro Turf International, the special master and set a rigorous schedule for True Life to follow in restoring the 101-acre site.

True Life has until Feb. 8 to respond to Barnes’ detailed proposal, which includes Wolfe’s observations of the current condition of the course and what work he thinks might be necessary to restore it.

Former owner Wilson Gee closed the course in 2013 and True Life bought it two years later with an eye toward building around 270 single and duplex houses. It proposed a so-called agrihood where a five-acre farm would be the focal point of the subdivision and that would include a private school, cafe and other amenities.

When it could not get enough homeowners to approve a change in the Covenants, Conditions and Restrictions requiring the site to remain a golf course, True Life unsuccessfully tried to persuade Hannah to toss that requirement and said it would built a “fun” course if it could still build the homes.

If it now can’t persuade Hannah to either reverse his ruling or reject Barnes’ latest submission, True Life can appeal the case to a higher state court, agree to Barnes’ terms or walk away from the site by putting it into bankruptcy.

True Life already has said restoring an 18-hole executive golf course on the site would never be profitable.

Wolfe’s ballpark estimate that it would cost between $5 million and $6 million is well under half the $14.1 million price tag that True Life’s consultant put on restoring the course.

Wolfe, whose firm is a golf course construction and renovation company, said in, a sworn affidavit to the judge that last July he “performed an extensive walk throughout the golf course to evaluate its then current condition.”

The Las Vegas resident, who has been in the golf industry since 1981, said he would serve as a special master overseeing the course’s restoration at a cost of $180 an hour and that he had neither any prejudice against True Life nor was familiar with the facts of the dispute in the court case.

“The basic core of the course is still intact,” Wolfe said in one of the documents submitted to the judge. “Obvious items will need to be constructed: clubhouse with cart storage and a maintenance building.”

He also said that “much of the existing cart path is in place but some of the water-crossing bridges will need to be rebuilt.”

He indicated that one of the great unknowns involved the water delivery system and virtually anything having to do with water, including the lakes, transfer stations and reservoirs.

“Most everything is missing in the pump station building, and as a result, a new pump station and more secure structure will need to be built,” Wolfe wrote. “The lakes that would need to remain would need to be relined with a PVC liner.”

Wolfe said replacing the entire irrigation system may be necessary and said the course itself “needs to have some feature shaping, bunker renovation, overall grassing and landscaping.”

He estimated the entire project would take between 14 and 18 months.

Barnes’ proposed restoration schedule sets out a timeline for undertaking all this work, and he suggests it begin in May with construction of the clubhouse, cart storage and maintenance buildings all occurring between July and September of next year.

He also asks Hannah to order True Life to pay unspecific attorney fees for his work as well as monetary damages to Linda Swain and Eileen Breslin, the two Ahwatukee Lakes residents who actually sued for the course’s restoration.

Barnes also asked Hannah to craft his order in a way that would require any new owner to follow the same restoration project and impose sanctions against True Life or any subsequent owner if they fail to complete it.

Under Barnes’ proposed plan for monitoring the restoration project, Wolfe would submit regular project updates and have the authority to review and approve any modifications to the initial plan as work proceeded.

The course owner also could ask the court to referee any disputes involving the work that may arise with Wolfe.

Given the schedule he has already set out for True Life’s response as well as Barnes’ counter to that response, Hannah could issue a final order as early as March.

But that would then trigger a time period when True Life could appeal his rulings – a matter that could take months to resolve.

Opponents of True Life had challenge the estimate of the work and cost that the company submitted last year.

Beyond the cost of restoration, True Life also has asserted that there is nothing to suggest that the course would attract enough golfers to make a profit for years, if ever.

After scoring a hole-in-one with a critical state Superior Court ruling last week, attorney Tim Barnes said he will seek the injunction to return an eyesore that has plagued Ahwatukee since 2013 to lush green fairways.

But that effort faces several hurdles, including a possible foreclosure, that could sidetrack this dream.

The dream became more realistic, however, after Maricopa County Superior Court Judge John Hannah issued a scathing ruling in favor of Linda Swain and other Ahwatukee Lakes homeowners, rejecting developer True Life Companies’ effort to build as many as 270 homes on the defunct 18-hole course.

True Life had argued that a decline in the golf industry represented a “material change’’ that should allow relief from deed restrictions requiring the 101-acre site to remain a golf course.

True Life and previous owner Wilson Gee chose to ignore those restrictions – and Hannah criticized them in his lengthy opinion.Hannah ruled that Gee and True Life violated the restrictions – which he said had amounted to contract with Ahwatukee homeowners – by purposely allowing the property to deteriorate and failing to maintain it as high-quality course.

Barnes said he is prepared to have the judge take the final step and order True Life or Gee to undo the damage.

“I am going to draft an injunction to restore the property,” Barnes said, repeating an argument from the trial that a well-maintained executive course could succeed with the right amount of promotion and support from the community.

He said more courses have opened than closed in Arizona in recent years, despite the Great Recession and the decline in popularity of golf sensation Tiger Woods, who once attracted swarms of golfers.

“Golf is not dead,’’ Barnes said. “That’s an easy thing to say and it’s not entirely true.’’

True Life and Gee had argued a change in the restrictions was justified because a stand-alone golf course is no longer financially feasible, that Ahwatukee Lakes was beyond repair and that it would be impossible to obtain funding to rebuild it.

True Life had opted for that effort to overturn the Conditions, covenants and restrictions governing the site’s use after failing to get more than half the approximate 5,400 Ahwatukee Lakes homeowners to agree to a change in the CC&Rs.

The company had spent more than a year in its campaign to win approval for a plan called Ahwatukee Farms, which would have made a five-acre farm the center of a development that would include the homes, a private school, a café and other amenities.

Barnes categorized Hannah’s ruling as a “repudiation’’ of True Life’s new position, saying that the judge ruled the property must be restored as a golf course – no matter the cost – to comply with the deed restrictions.

“The key to all of that is the CC&Rs are a contract between the property owner’’ and neighbors who benefit from the restrictions, Barnes said.

Many of those neighbors paid premium lot prices to be located on the course’s perimeter.

Gee started the course’s downfall by cutting off the water supply and closing the course in May 2013, Hannah ruled.The judge noted Gee’s testimony during the trial.

Gee had testified that he spoke with the Ahwatukee Board of Management in 2008 and with City Councilman Sal DiCiccio in 2009 about redeveloping the property.

Gee testified those early conversations led nowhere and he subsequently focused on selling the course as he started losing money during the recession.

But Hannah concluded, “There was no evidence that the golf course could not have been operated profitably in 2008.” He said Gee was mainly concerned was one of his other courses, Ahwatukee Lakes Country Club.

At the time, Gee owned all four golf courses in Ahwatukee. Last year he sold the Club West Golf Course for around $1 million. True Life bought Ahwatukee Lakes for about $9 million.

True Life bought the property in 2015 with no intention of operating a golf course and hopes of turning it into a lucrative residential development, the judge ruled.

Hannah reiterated his previous ruling from 2016, that the deed restrictions still require the operation of a golf course. His ruling cited the deed restrictions, which say, in part, that the site “shall be used for no other purposes than a golf course’’ and associated improvements.

He noted that Gee’s own lease between the investors who bought the property, Bixby Village Golf Course Inc., and Gee’s operating company, Ahwatukee Golf Properties, amplified the deed restrictions.

The lease required maintenance of Ahwatukee Lakes “in accordance with the standards of a high-quality privately-owned public and semi-private golf course,” the ruling said.

“By closing the Ahwatukee Lakes Golf Course in May 2013, shutting off the water and electricity, removing the irrigation heads from the irrigation system, draining the lakes and failing to maintain the property so that it could be used for golfing or golfing practice, Bixby breached its contractual obligations under the 1992 CC&Rs,’’ Hannah ruled.

True Life was bound by the same deed restrictions, even though the company chose to ignore them and attempted to get them modified to allow residential development instead, Hannah concluded.

“The inequitable conduct of Bixby Properties, which created the alleged hardship to the property owner, also cuts against equitable relief for” True Life, Hannah ruled, declaring:“At the very least, (True Life) had reason to know that Bixby’s actions substantially contributed to the conditions that made restoration of the golf course economically unfeasible. Bixby, not TTLC (Ahwatukee Lakes Investors), will bear most of the economic burden if the transaction fails. That result, frankly, will not be unfair.”

Hannah also alluded to True Life’s efforts to protect itself financially from an unfavorable court ruling, or a political failure to get the property rezoned, through the terms of an out clause in its promissory note with Gee.

While True Life plunked down a $750,000 down payment in 2015, it still owns $8.3 million to Gee to complete the sale.Barnes said that sets the stage for the next step if and when Hannah issues an injunction.

Lawyers will submit briefs arguing about the terms later this month and early next.

“I think they (True Life) will probably default. They put a lot of money into that property,” Barnes said, predicting that Gee will put the property into foreclosure and probably end up keeping it when he gets no takers.

Gee told AFN he does not know what he will do, adding that True Life officials told him they will contact him once they decide what they want to do.

Barnes said he is hoping that Gee, who testified during the trial that the property was worth $1 million if used as a golf course, will finally sell to someone interested in rebuilding the course.

“You can make a good living out of this golf course but you have to market it,’’ developing strong ties to the community and turning the course into a community staple, Barnes said.

Maricopa County Superior Court Judge John Hannah ruled Tuesday that a developer who wanted to transform the neglected property into houses acted in bad faith by purposefully failing to maintain the golf course.

He also rejected the developer's request to change the property's governing documents to allow for uses besides golf.

The ruling is a major win for Phoenix homeowners who've fought with a series of golf course owners for years over the property near Knox Road and 44th Street.

Councilman Sal DiCiccio, who represents the area, said the developers "came into our community and created an environmental mess."

"This should send a message to anyone else looking to develop this site — they cannot come into our community, dictate terms, create a disaster and expect to be rewarded for it," DiCiccio said in a statement. "Whatever shape this area takes in the future must have buy-in from our community, or it will not happen."

Years of court battlesIn May 2013, then-owner Bixby closed the Ahwatukee Lakes Golf Course and stripped the land of sod and irrigation equipment. A year later, the ownership group drained the lakes.

Bixby pursued opportunities to sell the land to residential developers who would fill the open space with more high-dollar homes, according to court records.

The governing documents that control the property, and the neighborhood surrounding it, specifically state that the open space "shall be used for no purposes other than golf courses" and other golf-related facilities, like clubhouses.

So two homeowners — whose homes back up onto the blighted golf courses — sued Bixby in 2014, arguing the owners breached their contract with the community and acted in bad faith by shutting down the course and allowing it to fall into disrepair.

In the midst of litigation, Bixby sold the golf course to the True Life Companies, which intended to redevelop the land into a residential community, according to Senior Vice President Aidan Berry.When the new owner was looped into the lawsuit, True Life argued the land could remain unused and not violate the governing documents.

But Maricopa County Superior Court Judge John Hannah disagreed. In 2016, he ruled that the documents required the operation of a golf course on the property.

According to the property's governing documents, there are only two ways to change the land's use: Either 51 percent of homeowners consent to the change, or the golf course owners appeal to the Superior Court and prove a "material change in conditions or circumstances" that make it unrealistic to operate a course on the land.

True Life first tried to convince homeowners, but fell about 1,500 signatures short, according to court documents.

It next tried to argue a change in conditions, saying, "There was no longer a realistic possibility that a stand-alone golf course could ever operate on the property."

Tuesday, it failed in that attempt as well.

In his decision Tuesday, Hannah wrote that True Life purchased the neglected property with full knowledge that the governing documents required it be maintained as a golf course.

He also ruled that True Life breached its covenant of good faith and fair dealing because it never intended to operate the property as a golf course even though it knew it was obligated to do so.

"In order to make millions for themselves, they destroyed the landscape, blighted our neighborhoods, divided our community, undercut the value of our homes — and then blamed the victims," plaintiff Linda Swain said in a statement.

Barry said his team was "deeply disappointed" in the judge's decision and is reviewing options.

Bixby did not respond to requests for comment.

But it's not overHannah's ruling was a huge win for the homeowners who've fought with the golf course owners for years, but it's in no way the final battle.

In his ruling, Hannah said the homeowners are entitled to some kind of relief, but what exactly that will include is still to be determined.

The homeowners said they will ask True Life to restore the golf course to its former glory, but Hannah will ultimately make the decision.

“We look forward to this decision helping us to renew our landscape and heal the scars in our community from this conflict," Ben Holt, president of Save the Lakes/Save Open Space, said in a statement.

But there's another wrinkle. True Life may not be the owner of the golf course for much longer. When it purchased the property from Bixby in 2015, the company paid only a $750,000 down payment on the $9 million purchase price.

The rest was due in increments down the road — but the purchase agreement also allowed True Life to walk away at any point without paying the remainder, which it still could do, according to court documents.

Hannah acknowledged this in his findings and said Bixby is likely to bear the majority of the economic burden, if the transaction fails.

A state Superior Court judge on Tuesday rejected The True Life Companies’ plan for houses and other amenities on the defunct Ahwatukee Lakes Golf Course.

Judge John R. Hannah Jr. also ordered True Life to pay the attorney fees of the two residents who sued to have the course restored and further directed their attorney to propose an order by Jan. 23 that would help him determine the next step in the long legal battle.

The verdict was a complete win for residents Linda Swain and Eileen Breslin as Hannah also rejected True Life’s request that he set aside the land-use regulation that required the 101-acre site to be maintained as a golf course.

True Life will have until Feb. 9 to react to his ruling and until Feb. 22 to file objections to whatever order is proposed by attorney Tim Barnes, who represents Swain and Breslin.

The course was closed in 2013 after then-owner Wilson Gee said it no longer was profitable.

True Life maintained the same position when it asked Hannah last year to set aside the course’s covenants, conditions and restrictions on grounds that the course’s terrible condition and the decline in the golf market constitute a “material change’’ that would justify a modification in the deed restrictions.

The ruling sets the stage for an intriguing future for the course, which could end up back in Gee’s hands. True Life agreed to buy the course for $8.25 million, but only put down $750,000.

Aiden Barry, True Life executive vice president, testified during the October trial before Hannah that a spinoff company created for the sole purpose of redeveloping the course, Ahwatukee Lakes Investors, could simply default on the $8.25 million payment due Gee on June 19, 2018.

The arrangement would potentially protect the parent company and others from liability and return the property to Gee, whose recourse would be foreclosure proceedings.

If the course ended up for auction, any potential buyer likely would have to consider Hannah’s findings in the suit brought by Swain and Breslin, since they basically uphold the deed restrictions on the site.

True Life originally wanted to reimagine the course as Ahwatukee Farms. It proposed to build about 270 homes, a five-acre farm, a private school and other amenities.

But the company could not a sufficient number of the Lakes’ approximate 5,400 homeowners to agree to a change in the CC&Rs that would pave the way for the development.

So shortly before the trial, it modified its plans and said it would install some kind of golf course as long as it got approval to build the houses. The company also proposed that the entire site become a separate homeowners association.

True Life had asserted that restoring the 18-hole executive golf course would cost at least $14 million with no certainty it could ever turn a profit.

Company executives maintained that their the proposal would correct a problem created from the beginning of Ahwatukee’s development, where 5,200 homeowners had no responsibility for supporting the course.

Swain and her expert, Buddie Johnson, who helped develop Las Sendas and Red Mountain Ranch in east Mesa, disagreed.​Swain envisions an executive course similar to Augusta Ranch in southeast Mesa. Johnson cited the property’s outstanding location and the area’s demographics as reasons a well-designed, competently operated executive course could prosper.

“I have had at least five substantial and capable buyers come to me and express an interest,’’ Johnson said. “It’s a site in the midst of 5,000 homes, with 200,000 people in a five-mile radius. They have the time, they have the money, they can play it fast.’’

He said he envisioned a family, or someone with experience in the golf business who is relocating from the Midwest, buying and operating the course, making it an integral part of the community with league play and other outings.

Executive courses appeal to many of the people who make arguments against golf, citing the expense, time, money and difficulty in playing the sport, Johnson said.

But True Life executive Tabor Anderson and Richard Carter, an expert hired by True Life as a consultant from Troon, contended that a stand-alone course could succeed on the property.

Anderson, who has developed 15 courses, said courses generally serve as an amenity to attract homebuyers or the construction of hotels and resorts.

“It took about one minute to decide that,’’ Anderson said, reflecting on his opinion that a stand-alone course is not viable. “You know how important it is to have those revenue sources to support the amenity upfront.’’

He said Carter’s conclusion that it would take 29 years for a builder to recoup its investment makes it impossible to find financing to replace the Ahwatukee Lakes course.

Johnson and Carter made vastly divergent estimates on how much such a course would cost. Johnson concluded about $4.8 million, using some cheaper options such as a modular clubhouse rather than a permanent one.

Johnson cited a $3.9 million renovation at Mountain Shadows in Paradise Valley and a $3.5 million renovation at Rolling Hills in Tempe. Neither course was as badly neglected as The Lakes.

Carter testified that he estimates a three-star facility would cost about $14 million, building a more permanent clubhouse, replacing the irrigation system and building a storage facility for expensive maintenance equipment.

“I’d get laughed out of the room’’ if he were to propose such a course, Anderson said. “That’s why these things are funded on the backs of developments.’’

He described True Life’s latest proposal as having a park-like buffer zone, separating existing homes from the new ones while providing a walking path. He said part of the development would have a park-like appearance while another part would feature the par-3 course.

Carter said Johnson’s estimate understated the true cost because it is too general. He said Troon would not be interested in building a course on the property.​“I would expect this course to be in the condition it is for a long period of time’’ because of a lack of return on investment and a low probability that it would do better under a different owner than Gee.

Ahwatukee’s golf courses​The long-awaited nonjury trial over the future of the defunct Ahwatukee Lakes Golf Course has yet to produce a verdict, but it may not matter anyway as far as resolving the stalemate over it is concerned.

After losing its yearlong campaign to get enough homeowners to back its proposal to build about 270 homes, a farm and some other amenities on the 101-acre site, The True Life Companies asked a state Superior Court judge to throw out the land-use regulations requiring a golf course.

That judge is also considering homeowners’ insistence that True Life be required to restore the course.​But company executives testified the firm would simply declare bankruptcy and walk away.

A radically different scenario occurred at Club West, where only a year ago homeowners were fretting over that golf course’s future.Longtime Ahwatukee resident Richard Breuninger bought the course and immediately restored the water-deprived site to lush green.

He also has other big plans for the course, which is now part of his Inter Tribal Golf Association of 63 Native American tribes owning a total of 111 courses nationwide.

A radically different scenario occurred at Club West, where only a year ago homeowners were fretting over that golf course’s future.Longtime Ahwatukee resident Richard Breuninger bought the course and immediately restored the water-deprived site to lush green.

He also has other big plans for the course, which is now part of his Inter Tribal Golf Association of 63 Native American tribes owning a total of 111 courses nationwide.

A radically different scenario occurred at Club West, where only a year ago homeowners were fretting over that golf course’s future.Longtime Ahwatukee resident Richard Breuninger bought the course and immediately restored the water-deprived site to lush green.

He also has other big plans for the course, which is now part of his Inter Tribal Golf Association of 63 Native American tribes owning a total of 111 courses nationwide.

Ahwatukee Foothills News - December 13, 2017

UPDATE: no news about a decision...Closing arguments in the trial of the two Ahwatukee homeownersvs The True Life Company were heard on Wednesday, Nov. 1.

When the judge renders his decision regarding the future of The Lakes at Ahwatukee Golf Course and property, that decision will be posted here.​​We appreciate your continued interest and support.

​Wilson Gee and his Japanese investors thought they were getting a great deal, selling the nine-hole Bixby Village course in Long Beach, Calif., and buying Ahwatukee Lakes Golf Course and Ahwatukee Country Club for about the same price.

It was the launch of Gee’s golf empire in Arizona. He subsequently bought The Duke in Maricopa and Club West in Ahwatukee Foothills, with the sales from developers highly motivated to sell.

But Gee’s timing was less than ideal, with the initial purchase in 2006, near the pinnacle of Arizona’s golf economy. The Great Recession would quickly follow, Ahwatukee Lakes would struggle to attract players and Gee’s water costs at Club West would soar.Gee outlined the downward trajectory of his gamble during testimony last week in the trial involving the future of the now-defunct Ahwatukee Lakes Golf Course.

“I apologize. If you look at the Lakes, I was a complete failure there,’’ Gee said, after testifying in Maricopa County Superior Court in a lawsuit challenging a developer’s plans to redevelop the Lakes. “We thought it would be our best course.’’

Gee turned off the water, stripped sod from the greens and watched the course die. He sold it to Ahwatukee Lakes Investors, a spinoff of True Life Companies, after his own attempts at redevelopment attracted no interest.

The challenges of changing the deed restrictions to allow residential development, and winning a rezoning case, were daunting.But Aiden Barry, True Life’s senior vice president, had thrived on solving problems that others could not, so the company bought The Lakes in June 2015 and tried in vain to sell Lakes residents on an “agrihood” that included about 270 homes, a farm and other amenities for the 101-acre site.

“The golf industry was going down at the time,’’ Gee testified. “We were losing money and we were looking for options.’’He listed the course on a golf course broker’s website and got few inquiries as the recession deepened. The problem was that longer championship courses were dropping their greens fees to attract a smaller number of players.

Rounds dropped so sharply that Gee’s summer greens fees went down to $10-$12, not even enough to pay his electricity.“Since 2007, the golf business started to go down steadily,’’ he said. “It’s just the general industry. There’s not enough people who play golf right now.’’

Maricopa County has about 300 courses and about 20-25 closed, with many of them executive courses, Gee said.Under questioning by Tim Barnes, an attorney represented by homeowners seeking to block True Life’s redevelopment plans, Gee said he would not sell the course for $1 million, saying that he had a $4 million to $5 million investment.

Gee testified that he sold his Bixby Village course for $5.25 million and bought Ahwatukee Country Club and The Lakes for $5.6 million.

Barnes said his research determined that The Lakes’ deed restrictions could not be changed without also modifying Ahwatukee Country Club’s deed restrictions.

Gee testified that he would consent to such a change for Ahwatukee Country Club – which he also owns – but has no plans to take advantage of it. He said his purpose is to operate golf courses.

His original investor was a Japanese man who loved golf and wanted to own a course. The man died, but his three sons followed the same approach, remaining patient as the rate of return dropped from 7 percent to 4 percent or even less.

He said Ahwatukee Country Club is “probably breaking even right now,’’ while the sale of Club West, which he purchased in 2009 from Suncor for a bargain price, is pending to a new owner.

Gee was reluctant to speak about the Club West sale, because it is in escrow. The sale relieves Gee from a knee-buckling water bill of $700,000 a year, because only expensive potable city water is available.

Barnes asked why Gee bought Club West when The Lakes had already turned into a financial burden.

“They kept dropping over and over,’’ he said of Suncor’s asking price for Club West. Gee eventually paid $1.5 million, which he conceded was not a good business move in the end. “We thought there was an opportunity there. We thought it would pick up. We were wrong,’’ Gee said.

True Life Companies took a calculated risk – spending $3 million to sell its vision of turning the fallow Ahwatukee Lakes Golf Course into a lucrative residential redevelopment plan.

Aiden Barry, True Life senior vice president, testified in Maricopa County Superior Court that he thought he could collect the signatures of 51 percent of property owners to change deed restrictions that require the property to remain a golf course if the company came up with the right concept.

But while Barry’s company collected about 2,000 signatures for its controversial Ahwatukee Farms proposal – a preschool, urban garden and residential development – it failed to collect the 3,564 signatures required.Now, the fate of True Life’s crapshoot rides on a pending ruling by Superior Court John Hannah, who must decide whether the former course’s terrible condition and the decline in the golf market constitute a “material change’’ that would justify a modification in the deed restrictions.

Even if Hannah were to rule in True Life’s favor, the company would still face a stormy Phoenix rezoning hearing on its latest plan, which combines a nine-hole par-3 course with about 275 new homes. Closing arguments are scheduled in Hannah’s north Phoenix courtroom today, Nov. 1.

If nothing works out, Barry said, company executives testified that a spinoff company created for the sole purpose of redeveloping the 101 acres, Ahwatukee Lakes Investors, could simply default on an $8.25 million payment due on June 19, 2018.The arrangement would potentially protect the parent company and others from liability and return the property to former owner Wilson Gee, whose recourse would be foreclosure proceedings.

True Life paid Gee $750,000 on June 19, 2015 and had $500,000 payments due on a promissory note on the same date in 2016 and 2017, according to the testimony.But with costs soaring and no true progress being made toward selling off lots or possibly building houses itself, True Life sought and received amendments to the purchase agreement. Gee allowed True Life to forgo the payments in return for an interest payment, which Gee subsequently waived.

“We went into this with eyes wide open,’’ Barry said. “We evaluated the risk and decided to move forward.’’“True Life approached this knowing there was an ultimate zoning case with the City of Phoenix,’’ he said. “If we were successful in garnering the 51 percent support from the community, there would likely be good support for the rezoning case.’’

Barry was generally composed while he was questioned by Tim Barnes, an attorney for Ahwatukee residents Linda Swain and Eileen Breslin, who have been staunch opponents of the redevelopment plan.But he grew a bit testy when he thought Barnes implied that True Life failed to gain support for Ahwatukee Farms, a plan Barry said he thought would appeal to the entire community rather than just golfers.“We gained the support of 2,000 residents,’’ Barry testified. “We gained tremendous community support’’ – the most, he added, in his career for such a change.

He acknowledged, however, that the company turned to a Plan B after realizing the signature drive was doomed: pursuing legal action to change the deed restrictions under the “material change’’ provision in the deed restrictions.

The latest plan, featuring the par-3 course, emerged in court documents just days before the trial.But Barry and Tabor Anderson, another True Life executive, said a golf course supported by a homeowners association made up of new residents who purchase the homes always was an option.“You just defined a land option,’’ Anderson said when Barnes outlined details of the sale agreement.

When Barnes questioned the need for a $200,000 political consultant, Anderson explained the realities of redeveloping an appealing infill site surrounded by homes in an upscale community. These were the same qualities that enticed True Life into the purchase.

“Entitlements work is like running a political campaign. Instead of getting elected, you get approvals,’’ Anderson said.The course would feature larger-than-normal greens with two pins. Golfers could shoot for, say, the white pins during the first nine holes, then shoot for the blue pins during their next round to add variety.

The HOA would own the golf course and members would be liable to support the course financially if a shortfall was encountered.Anderson and others testified in no uncertain terms that a new stand-alone course, supported almost entirely by greens fees, would not succeed.

Anderson said the proposal would correct a problem created from the beginning of Ahwatukee’s development, where 5,200 homeowners had no responsibility for supporting the course.

Swain and her expert, Buddie Johnson, who helped develop Las Sendas and Red Mountain Ranch in east Mesa, disagreed.Swain envisions an executive course similar to Augusta Ranch in southeast Mesa. Johnson cited the property’s outstanding location and the area’s demographics as reasons a well-designed, competently operated executive course could prosper.

“I have had at least five substantial and capable buyers come to me and express an interest,’’ Johnson said. “It’s a site in the midst of 5,000 homes, with 200,000 people in a five-mile radius. They have the time, they have the money, they can play it fast.’’

He said he envisioned a family, or someone with experience in the golf business who is relocating from the Midwest, buying and operating the course, making it an integral part of the community with league play and other outings.Executive courses appeal to many of the people who make arguments against golf, citing the expense, time, money and difficulty in playing the sport, Johnson said.

But Anderson and Richard Carter, an expert hired by True Life as a consultant from Troon, made Johnson’s opinion sound like a pipe dream.“No chance,’’ Anderson said bluntly when asked whether a stand-alone course could succeed on the property.Anderson, who has developed 15 courses, said courses generally serve as an amenity to attract homebuyers or the construction of hotels and resorts.“It took about one minute to decide that,’’ Anderson said, reflecting on his opinion that a stand-alone course is not viable. “You know how important it is to have those revenue sources to support the amenity upfront.’’He said Carter’s conclusion that it would take 29 years for a builder to recoup its investment makes it impossible to find financing to replace the Ahwatukee Lakes course.

Johnson and Carter made vastly divergent estimates on how much such a course would cost. Johnson concluded about $4.8 million, using some cheaper options such as a modular clubhouse rather than a permanent one.Johnson cited a $3.9 million renovation at Mountain Shadows in Paradise Valley and a $3.5 million renovation at Rolling Hills in Tempe. Neither course was as badly neglected as The Lakes.

Carter testified that he estimates a three-star facility would cost about $14 million, building a more permanent clubhouse, replacing the irrigation system and building a storage facility for expensive maintenance equipment.“I’d get laughed out of the room’’ if he were to propose such a course, Anderson said. “That’s why these things are funded on the backs of developments.’’He described True Life’s latest proposal as having a park-like buffer zone, separating existing homes from the new ones while providing a walking path. He said part of the development would have a park-like appearance while another part would feature the par-3 course.Carter said Johnson’s estimate understated the true cost because it is too general. He said Troon would not be interested in building a course on the property.“I would expect this course to be in the condition it is for a long period of time’’ because of a lack of return on investment and a low probability that it would do better under a different owner than Gee.

And it also warned that if he orders the company to restore the old course, the land will remain barren indefinitely.The bombshell disclosures are contained in a brief filed by attorney Chris Baniszewski with state Superior Court Judge John R. Hannah Jr., who began on Tuesday, Oct. 24, hearing evidence in a three-day trial on two residents’ demand that True Life be ordered to restore the course.

Conspicuous by its absence is any mention of the company’s Ahwatukee Farms plan, which would have turned the site into an “agrihood.”

The brief gives no details on how many homes and what kind of course the company would build if Hannah grants its request to modify the covenants, conditions and restrictions that first governed the site in 1986 and then renewed indefinitely in 1992.

All it states is: “The modification will allow additional homes to be built on the property that will generate the necessary funding to construct and operate a golf course.”

Attorney Thomas Barnes, who represents Lakes residents seeking the restoration of the 18-hole executive golf course, states in his brief that True Life wants to build a nine-hole “fun course.”

Baniszewski also warns that if True Life can’t build homes, “no golf course will be operated on the property and it will remain in fallow condition.”

True Life Executive Vice President Aiden Barry declined comment when asked about the brief by AFN last weekend.Barnes asserts that True Life knew what the CC&Rs required when it paid $9 million to buy the site in 2015.

But he charges that True Life “was looking at the profitability of the sale of residences, not the operation of a golf course” when it bought the site and cannot now seek a modification of the CC&Rs.

Besides, he notes, the same set of CC&Rs govern both the Ahwatukee Lakes Golf Course and the Ahwatukee Country Club. That means True Life can’t have the CC&Rs modified because it doesn’t own Ahwatukee Country Club.

The brief seems to signal an end to the “agrihood” that True Life unveiled in August 2016.

That plan called for 270 single-family and duplex houses, a five-acre farm, a private school, café and other amenities on the site.The company waged an aggressive campaign to persuade 51 percent of the approximate 5,400 Lakes homeowners to agree to a change in the CC&Rs that would pave the way for the agrihood.

That campaign stalled, reportedly at around 2,000 signatures, and True Life eventually asked the judge to rule that a “material change” in the course warranted a modification of the CC&Rs.

Lakes residents Linda Swain and Eileen Breslin want Hannah to order True Life to restore the 18-hole course.

In July of last year, Hannah ruled that the CC&Rs required a course, but left for trial the issue of whether True Life could be ordered to do that.

But True Life earlier this year released a consultant’s study that estimated it would cost $14 million to restore the course – and that figure did not include operating expenses.

In his brief, Baniszewski states, “The relative hardships in this case weigh heavily in favor of TTLC.”

“The cost of reconstructing and operating a stand-alone golf course on the property prevents TTLC from operating a golf course even if the court were to grant an injunction,” he states, adding that True Life “cannot attract investors or obtain a loan” for such a venture.

He also says the residents want an “aesthetically pleasing view, but that does not justify a requirement that TTLC expend millions of dollars to reconstruct and operate a golf course that lost money the last four years it was in operation and will likely not make a profit in the future.”

Baniszewski said it would take True Life 29 years just to recover its initial investment if it was forced to recreate a course.“Consequently, the only realistic funding mechanism for a new golf course on the property is for a new golf course to be built in conjunction with a new home development.,” he adds.

True Life is proposing that the judge allow housing and that those new houses would comprise a new homeowners association that would operate the course.

Barnes counters, “The lack of profitability in operating a golf course on the property is a function of the $9 million price TTLC agreed to pay to purchase the Lakes Golf Course.”

While Barnes told the judge that residents are entitled to an injunction ordering the restoration of the course, Banizewski’s brief paints a grim picture of what could result.

Saying the likelihood of anyone restoring the site to its former glory “is remote at best,” he states:“Instead the property will most likely be mired in bankruptcy proceedings. Moreover, given this court’s ruling that the owner of the property must operate a golf course, the chance that the property will be sold out of bankruptcy is also very unlikely….No golf course will be operated on the property and it will remain in its fallow condition.

Save the Lakes street clean up
>> June 10, 2017 <<

Save The Lakes is committed to making our community better by helping keep trash collected on Warner Road.(We welcome all volunteers from our ranks - our next "pick-up" event will be in early July.)

After nearly two years of studying flood risks in Ahwatukee that could cause more than $5 million in damage to 492 homes, apartments, commercial buildings and other structures, county and city officials have one piece of advice for owners and renters in harm’s way.

Get flood insurance.

But even if you got it today – in the middle of monsoon season – you’ll still have to wait 30 days before it takes effect.The advice emerged Monday during an Ahwatukee Foothills Village Planning Committee meeting over a frustrating fact: While city and county officials now know where the problems lie, there’s little money to fix them.

And in cases where flooding issues are linked to other property owners’ lack of maintenance, officials aren’t sure if they can force those owners to correct the problems.

“It’s frustrating,” said Karen Young, who appeared before the committee as it discussed the Maricopa County Flood Control District’s final version of the nearly two-year-long study.

That study pinpoints 21 intersections, 15 streets and segments of major arterials, two hillsides and a channel entrance behind Lomas Elementary school as being at risk for heavy damages in a so-called 100-year flood.

Although the term “100-year flood” is a simple definition of a catastrophe that statistically has a 1 percent chance of occurring in any given year, Young discussed how her 80-year-old mother had already been hit twice by fate in three years.

Her mother’s home, near the clubhouse in Ahwatukee Country Club, incurred $14,000 in damage in 2014 and another $4,000 last year. Since then, she’s also forked out $3,000 on flood prevention improvements.

To her dismay, she also heard Hasan Mushtar, the city’s flood plain manager, concede that owners might not be able to get flood insurance if they’ve incurred flood damage before.

The county doesn’t even know how much it would cost to correct all the problems it identified.

It took only six hazards, further studied them and determined that eliminating them will each cost between $100,000 and $2 million.Only one was advanced into the grant-seeking process.

That project – construction of a flood wall and other preventive measures on South Manden Street, a frequent target of runoff from South Mountain – will cost an estimated $1 million.

The Federal Emergency Management Agency already rejected a request for partial funding last fiscal year, so local officials are hoping FEMA will change its mind.

Mushtar told the planning committee he hopes funding will come through so that “either this year or next it will go into final design.” It will then require four months of design and up to another 12 months’ construction.

As for the other five projects identified for “immediate” work, no funding is in sight.

And the remaining hazards identified by the county are even deeper in limbo; corrective work has not been fully proposed, so there are no estimates on what potential fixes might cost.

“We can’t get rid of the risk immediately of every problem, so we need to warn homeowners in those areas about getting flood insurance,” said committee chairman Chad Blostone. “We’d like to do it quickly.”​Mushtar said it would take at least two weeks for the city to put together a warning letter for property owners in the flood-prone areas, though he said the review process could take longer before a letter would be ready to send out – meaning a warning like would not arrive in owners’ mailboxes until the monsoon season is practically winding down.

AFN file photo

Blostone’s sense of urgency is based on the fact that regular homeowner insurance will not cover damages caused by water from a source outside the insured property – such as hillside runoffs or fast-moving downpours that overwhelm drainage systems.

Meanwhile, officials had no immediately clear answers on another problem that is associated with some of the flood-prone sites: inadequate maintenance on some nearby property that might not even be in the danger zone.​That situation apparently is exactly what happened to the home of Young’s mother because a channel on the Ahwatukee Golf Club’s course may need to be deeper.

City of Phoenix

City of Phoenix

City of Phoenix

“Is there something you can do so this private property owner can be forced to correct the problem and if so, what?” Young asked.No one at the meeting knew, though city Councilman Sal DiCiccio said he would find out, promising to set up a meeting over the next week between Young and city code enforcement officers to see if golf course owner Wilson Gee’s company can be ordered to fix the problems.

Mushtar said city officials have had discussions with the owner to rectify the problem but that little has been accomplished.

“We can start the discussion again with the property owner,” he said.

DiCiccio said more action than that was necessary after Young said the golf course owner is “not going to do it voluntarily because they’re afraid that would admit liability.”

“Apparently, they don’t mind the government or the Ahwatukee Board of Management from coming onto their property and doing it for them, but why should ABM or the city do it?” Young later said in an interview.

City of Phoenix

​Meanwhile, Mushtar reminded the audience that the county study “was not meant to point fingers at anybody. It’s to identify problems.”

Attorneys for developers seeking to turn The Ahwatukee Lakes Golf Course into a 300 unit, $100 million housing tract and make millions for themselves are now asking a judge to change CC&Rs that block the project, after Ahwatukee residents refused to give their permission.

In a telephone hearing Thursday (April 20), Judge John Hannah agreed both to hear the developers’ latest argument and to try the full case on which he ruled last year, now set for Oct. 23-25. Until the developers' latest pleading, the case had been set for June 12. Judge Hannah ruled against developer The True Life Companies last summer, declaring that the CC&Rs require that The Ahwatukee Lakes Golf Course be operated as a golf course. The point of the developers' latest pleading seems to be to ask the judge to reverse himself because of what True Life’s attorneys now claim to be a “material change in….circumstances.”

Save the Lakes/Save Open Space responded:“The only change in circumstances we see is that True Life failed to get the permission of 51 percent of Ahwatukee residents to change the CC&Rs. True Life lost their motion to dismiss the case when Judge Hannah ruled against them last year. Since they’ve also failed to earn our community’s support, True Life now looks to be asking the judge to rule against the community and change the CC&Rs, because the developers claim it will cost them too much to re-construct the Golf Course that the judge ordered be operated.”

Save the Lakes co-plaintiffs Linda Swain and Eileen Breslin said: “The delay of the trial is another test of our community’s patience. But it also indicates that our case remains strong. While we regret the further delay, we’re grateful for the signs that True Life appears to be reaching the true end of the road.”“We remain confident in our case and in our legal team. Most of all, we’re grateful that our community saw through True Life and its plan, which would produce more traffic jams, overcrowding, and more potential for flooding –- instead of a renewed golf course and open space.”​“We are deeply grateful to our community for refusing to sign True Life’s petition, and for standing behind us in this effort to save the heart of Ahwatukee. We welcome and will very much appreciate our community’s further financial support, to help us win the case.” “Contributions may be sent to: Lakes Golf Course Legal Defense Fund c/o Timothy H. Barnes, P.C. 428 E. Thunderbird Road, #150 Phoenix, Arizona 85022 (602) 492-1528 (Direct) “